On 21 June 2017, Travis Kalanick, Uber’s controversial CEO, finally announced his decision to step down. The move followed months of turmoil for the tech giant, with drivers deleting their accounts over strike-breaking, accusations by Google of industrial espionage, Kalanick filmed having a row with one of his own drivers, and allegations that sexual harassment was unchecked in the company’s toxic ‘brogrammer’ culture.
It was clear that Kalanick, despite having taken the company he co-founded in 2009 to global prominence and amassed a large personal fortune, was simply incompetent as a manager – and he’s not the only entrepreneur at whom that charge can be leveled. The single-minded passion that gets a venture off the launch pad can often turn into a barrier when it comes to sustainable growth and, like Kalanick, many CEOs are resistant to suggestions that they should step aside.
Executive coach Steve Tobak wrote in Inc Magazine in 2013 that there are five common pitfalls that entrepreneurs fall into when trying to step up to the CEO mark: they’re too invested in their own vision; they aren’t willing to make the hard choices; they don’t have a passion for managing; they don’t get marketing; and they usually aren’t willing to step down. Executive coach Kate Burton, who has worked with companies including Microsoft, KPMG, SwissRe and Waitrose, believes the answer may be more fundamental: good managers and successful entrepreneurs are simply different personality types.
“Entrepreneurs are the kind of people who see the big picture: they’re visionary and fast-moving,” she says. “Managers need to temper things through systems and processes, and getting things done through people, and that’s a different mind-set. An entrepreneur needs to be innovative which can be a high-risk strategy. They’re able to run with their ideas because they’re pursuing their passion. A successful manager is driven by attention to detail and metrics, is mindful of risks and takes steps to mitigate against them. ”
Let go and let it grow
As a business matures, its founder’s focus will inevitably shift away from its core activity and towards the challenges of running a successful, growing venture. For Sheena Marsh, founder and Director of Oxford Garden Design, that has meant spending less time doing the garden designs she loves, which inspired her to start the business in the first place.
“I started as a sole trader, then took on my first employees in 2011. Since then we’ve really grown – we’ve got 27 staff members and we’ve just reached £1m a year turnover,” she says. “I love designing gardens, but the more the business has grown, the more I have moved away from that. I do no design any more, and I don’t go and visit clients any more, which I also used to love.
“As a business owner, you have to accept that you can get in the way of your own business if you try and cling on to too many things. It’s only by letting go that I’ve been able to allow the business to grow.”
For Marsh, the key to allowing her business to succeed and grow has been trusting and empowering the people she appoints. “Building up a team that can function without you depends on empowering people,” she says. “I believe in giving people responsibility, assuming you’ve got the right people – and I’ve got a marvellous team behind me. Trust is a fundamental principle, and giving people authority. I encourage them to come up with solutions to problems before they come to me. I love managing people – with a background in teaching, it comes naturally to me.”
Which way out
However, not all entrepreneurs adapt so easily to the challenges of leadership. Many, like Kalanick, cling on to power until they are forced out – and that’s bad for both the business and the individual. Fortunately, for business owners struggling to adapt to the role of CEO, there are solutions – but acknowledging your weaknesses is the first step to finding them, Burton believes.
“People I have worked with successfully have been willing to recognise that they’re not perfect, and that there are other ways,” she says. “They’ve been willing to get help, rather than just doing things their own way. And they’ve been willing to listen.”
Help can take the form of personal or business coaching, or consultancy. It can help business leaders to build a team of people they trust, accepting that they don’t have all the answers and that surrounding themselves with people who know more than they do is good for the business.
Ultimately, though, some business owners accept that their company will be more successful if they step aside. “It is better to elect to step step down than to be ousted,” Burton says. “And there needs to be an exit strategy*. They need to be able to step away, rather than doing the Rupert Murdoch thing of carrying on into their dotage and being unable to let go!”
Letting go is an issue Marsh has already considered – although she’s got no intention of doing so just yet.
“I’m continuing to grow the business and I’m having a lot of fun doing so,” she says. “I don’t want to do anything dramatic just yet! But I’ve just become a grandmother for the first time and it would be lovely to spend a little bit more time with my grandchild, and not be as involved in the day-to-day running of the business as I have been. But I think that while I’m enjoying it, why would I ever stop?”
*Exit strategies may include the referral to a service that is separate and distinct to those offered by St. James’s Place.
Where the opinions of third parties are offered, these may not necessarily reflect those of St. James’s Place.